Título III. Infracciones y sanciones

Tax sanctioning rules shall govern for the future. Nevertheless, those that eliminate violations and establish more benign sanctions shall have retroactive effect, provided that they favor the offender and do not affect final decisions or judgments.

This Code shall be applicable to violations and sanctions, strictly in tax matters, except as provided by the special rules established by the laws governing each tax.

Tax subjects or their representatives who are required to file a return shall do so in accordance with the provisions of this Code and shall be liable, in accordance with the law.

Any action or omission involving violation of substantive or formal tax rules constitutes a violation to be sanctioned by the Tax Administration, insofar as it does not constitute a crime or misdemeanor punishable under criminal legislation.

Where any of the tax violations contained in Article 85 of this Tax Code is committed, proceedings shall be conducted in accordance with the provisions of Article 86 of this same legal body.

When crimes defined as such in criminal law, related to tax matters, are committed, jurisdiction over them shall lie with the competent tribunals of the criminal branch.

*When the existence of a crime is presumed, the Tax Administration shall immediately report the act to the competent criminal judicial authority, without prejudice to the collection of the taxes owed to the Treasury. Payment of the defrauded tax by the accused person does not release him from his criminal liability.

The Controlling Judge of the investigation in proceedings in which tax obligations are disputed shall allow the attorneys designated by the Tax Administration to review the judicial proceedings and assist the Public Prosecutor's Office in the criminal prosecution.

The following are tax violations:

1.Late payment of withholdings.

2.The default.

3.The omission of payment of taxes.

4.The resistance to the auditing action of the Tax Administration.

5.The non-compliance with formal obligations.

6.The others expressly established in this Code and in specific tax laws.

The presumptions established in this Code and in other specific tax laws regarding violations and sanctions admit evidence to the contrary.

When an act constitutes more than one violation, each of them shall be sanctioned.

For the purposes of this Code, the person sanctioned by decision of the Tax Administration, duly notified, who commits another violation within the time limit of four years incurs recidivism.

The repeat offender of a violation punishable only by a fine shall have said fine applied increased by fifty percent (50%). If the sanction is applied based on the amount of a tax, in no case may it exceed the amount thereof.

*If recidivism occurs in violation of the cases contemplated in Article 85 of this Code, within the four (4) years following the date on which the first sanction was applied, the definitive closure of the company, establishment or business shall be applied, and the Mercantile Registry shall cancel the registration and the business license.

Tax violations and sanctions are extinguished on the following grounds:

1.Death of the offender.

2.Relief or remission.

3.Limitation period.

4.In the other cases contemplated in Article 55 of this Code.

Tax violations and sanctions are subject to a limitation period of five years, counted from the date on which the violation was committed or the sanction became final, respectively.

Liability for violations is personal, except for the exceptions established in this Code.

The following are causes exempting from liability:

1.Legal and absolute incapacity.

2.Fortuitous event and force majeure.

The perpetrators are liable for the tax violations they commit.

The following are considered authors:

1.Those who take direct part in the execution of the act or omission.

2.Those who directly induce another to commit the violation.

3.Those who participate in the execution of acts without which the violation would not have been committed.

The passive subjects of the tax obligation shall be liable before the Tax Administration for the acts or omissions of their representatives, without prejudice to the corresponding joint and several liability.

Professionals or technicians shall issue their opinions, certifications or other similar records, related to tax matters, in accordance with applicable legal, scientific or technical norms and principles.

Passive subjects of the tax obligation shall be liable to the Tax Administration for the acts or omissions of their dependent personnel, in the exercise of their office.

Surcharges shall be applied from the day immediately following the date of expiry of the time limit established for payment of the tax, until the day preceding the day on which payment thereof is made.

The omission of payment of taxes is constituted by the failure to determine or incorrect determination of the tax obligation by the passive subject, detected by the tax administration provided that the failure to determine does not constitute a crime.

Failure to pay taxes shall be sanctioned with a fine equivalent to one hundred percent (100%) of the amount of the omitted tax, for failure to determine or the incorrect determination submitted by the taxpayer, detected by the audit action.

This sanction, where applicable, shall be applied without prejudice to collecting the corresponding compensatory interest, as provided in this Code.

If, from the investigation conducted, indications appear of the commission of a crime or a misdemeanor provided for in criminal legislation, the Tax Administration shall refrain from imposing any sanction and shall proceed to bring it to the knowledge of the competent authority, without prejudice to receiving payment of the tax debt and this does not release the taxpayer from criminal liability. The Tax Administration shall in no case sanction the same violation twice.

Those who, acting in the capacity of withholding or collection agent or as taxpayers of the Value Added Tax, do not remit to the corresponding fiscal coffers, within the time limit established by the tax laws, the taxes collected or withheld or the Value Added Tax, shall be sanctioned with a fine equivalent to one hundred percent (100%) of the tax withheld or collected or the resulting payment of the Value Added Tax.

If the person liable for payment makes it effective before being required by the Tax Administration, the sanction shall be reduced by fifty percent (50%).

After thirty (30) working days have elapsed, counted from the notification of the requirement, without the withholding or collection agent complying with the obligation to remit the taxes, action shall proceed as provided in Articles 70 and 90 of this Code.

The taxpayer who pays the tax obligation after the time limit fixed by the Law for doing so incurs default. Default operates by operation of law.

SANCTION: In case of default, a sanction for each day of delay shall apply equivalent to multiplying the amount of the tax to be paid by the factor 0.0005 by the number of days of delay. The sanction for default shall not apply in cases of assessments, adjustments to incorrect determinations, or in determinations on its own initiative made by the Tax Administration, in which the sanction for failure to pay taxes established in Article 89 of this Code shall apply.

The sanction for default is independent of the payment of the compensatory interest referred to in this Code.

Resistance constitutes any action or omission that obstructs or prevents the auditing action of the Tax Administration, after expiration of the non-extendable time limit of three (3) days, counted from the day following the notification of the requirement delivered to the taxpayer to submit documentation or information of a tax, accounting or financial nature.

Also constitutes resistance to the auditing action of the Tax Administration, any action or omission that obstructs or prevents immediate access to the books, documents and files, or to the taxpayer's computer system that relate to the payment of taxes, as well as the inspection or verification of any premises, commercial or industrial establishment, deposit offices, containers, cash registers and means of transport, in cases where the Tax Administration must require immediate access, to avoid the risk of alteration or destruction of evidence.

The following are considered actions of resistance:

1.To prevent or obstruct the proceedings or formalities necessary for the Tax Administration to determine, audit and collect taxes.

2.To refuse to provide information and to prevent immediate access to the books, documents and files, or to the taxpayer's computer system that relate to the payment of taxes, necessary to establish the tax base of taxes and to verify the cancellation of the tax obligation.

3.The taxpayer refusing to provide information referring to acts, contracts or other facts or commercial relations with third parties that generate taxes.

*4. Not to redo its accounting registers, or to redo them outside the time limit established in the present Code, in cases of destruction, loss, deterioration, misplacement, or crimes against property occurring with respect to books, registers, documents, files or computer systems.

*5. To omit the register in the accounting books of the bank accounts and investments held in the different banks or financial groups of the Republic of Guatemala or abroad, in accordance with the provisions of the Commercial Code. It is understood that there is omission of register in the accounting books if the taxpayer does not register one or more bank accounts held in its name in the different banks or financial groups of the Republic of Guatemala or outside it; does not prepare the bank reconciliations that determine the reasonableness of the accounting balance and the journal entries are not supported by the documents originating the transaction.

SANCTION: Fine equivalent to one percent (1%) of the gross income obtained by the taxpayer during the last monthly, quarterly or annual period declared under the regime of the tax to be audited. When the resistance is of the kind that is constituted immediately, the sanction shall be doubled.

If for compliance with that required by the Tax Administration the intervention of a competent judge is necessary, the provisions on resistance to the auditing action criminalized in the Criminal Code shall apply.

* Numeral 4. is added to the third paragraph by Article 27 of Decree of Congress Number 20-2006 of 06-07-2006

The action or omission of the taxpayer or liable party that implies non-compliance with those provided for in this Code and in other tax laws constitutes a violation of formal duties.

The following are violations of formal duties:

1.Failure to give notice to the Tax Administration of any modification or updating of registration data and of the appointment or change of accountant. All of the foregoing within the time limit of thirty (30) days, counted from the date on which the modification or updating occurred.

SANCTION: Fine of fifty quetzales (Q.50.00) for each day of delay with a maximum sanction of one thousand five hundred quetzales (Q.1,500.00).

2.Omission or alteration of the Tax Identification Number -NIT- or of any other requirement demanded in tax declarations and receipts, import or export documents and in any document that is filed or must be filed before the Tax Administration.

SANCTION: Fine of one hundred quetzales (Q.100.00) for each document. The maximum sanction may not exceed one thousand quetzales (Q.1,000.00) monthly. In no case shall the maximum sanction exceed the sum of one percent (1%) of the gross income obtained by the taxpayer during the last monthly period in which it reported income.

3.Acquiring property or services without demanding invoices or the document that legally supports the transaction, when applicable.

SANCTION: Fine equivalent to the amount of the tax corresponding to the transaction. If the purchaser files a complaint before the Tax Administration against the person who, being obligated, did not issue nor deliver to him the corresponding legal document, he shall be exonerated from the sanction.

4.Failure to keep up to date the accounting books or other mandatory registers established in the Commercial Code and the specific tax laws. They are understood to be up to date if all transactions are recorded in the duly authorized and enabled books and registers, within the two (2) immediate calendar months following their completion.

SANCTION: Fine of five thousand quetzales (Q.5,000.00), each time it is audited. This sanction shall be applied without prejudice to the obligation of the taxpayer or liable party to duly maintain the accounting books or registers with respect to which the Tax Administration established their delay.

5.Keeping the books and accounting registers in a manner different from that required by the Commercial Code and the specific tax laws.

SANCTION: Fine of five thousand quetzales (Q.5,000.00) each time it is audited and the violation is established.

6.Offering property and services without including the tax in the price, when applicable.

SANCTION: Fine of five thousand quetzales (Q.5,000.00) each time the violation is incurred.

7.Failure to collect or withhold taxes, in accordance with the rules established in this Code and in the specific laws of each tax.

SANCTION: Fine equivalent to the tax whose collection or withholding was omitted. The imposition of the fine does not exempt the obligation to pay over the tax collected or withheld, unless payment has already been made by the passive subject.

8.Issuing invoices, debit notes, credit notes or other documents that do not comply with any of the formal requirements under the specific law.

SANCTION: Fine of one hundred quetzales (Q.100.00) for each document. The maximum sanction that may be applied shall be five thousand quetzales (Q.5,000.00) in each monthly period. In no case shall the maximum sanction exceed two percent (2%) of the gross income obtained by the taxpayer during the last monthly period in which it reported income.

9.Filing returns after the time limit established in the specific tax law.

SANCTION: Fine of fifty quetzales (Q.50.00) for each day of delay, with a maximum sanction of one thousand quetzales (Q.1,000.00).

When the violation is committed by entities that are totally or partially exempt from the Income Tax, for carrying out nonprofit activities, the sanction shall be doubled. In case of recidivism, in addition to the imposition of the corresponding fine, the definitive cancellation of the registration as a nonprofit legal person in the corresponding registers shall be ordered.

10.Failure to appear at the tax offices when his presence is required, as established in numeral 6 of Article 112 of this Code.

SANCTION: Fine of one thousand quetzales (Q.1,000.00) for each time he is summoned and fails to appear.

11.Failure of the purchaser to effect the transfer in the corresponding legal register, within the time limit established by the specific law, of the ownership of the vehicles he acquires.

SANCTION: Fine equivalent to one hundred percent (100%) of the applicable tax pursuant to the rate established by the Value Added Tax Law.

12.Failure to give notice within the time limit established by the specific law of any change occurring in the characteristics of the vehicles registered in the corresponding register.

SANCTION: Fine of five hundred quetzales (Q.500.00).

13.Failure to file before the Tax Administration the reports established in the tax laws.

SANCTION: A fine of five thousand quetzales (Q.5,000.00) the first time; of ten thousand quetzales (Q.10,000.00) the second time and in case of non-compliance more than twice a fine of ten thousand quetzales (Q.10,000.00) plus the equivalent of one percent (1%) of the gross income obtained by the taxpayer during the last month in which it declared income shall be applied. This sanction shall be applied each time it fails to comply with its obligation.

14.Using registering machines, cash registers or other authorized systems in establishments other than the one registered for their use, without having given notice to the Tax Administration.

SANCTION: Fine of five thousand quetzales (Q.5,000.00).

15.Carrying out, without being registered, activities for which the tax rules have established the obligation to be previously registered in the registers enabled by the Tax Administration.

SANCTION: Fine of ten thousand quetzales (Q.10,000.00).

16.Failure to make payment of taxes or to provide the required information, occasionally or periodically, through the systems or tools, forms, electronic, computer, digital forms or others that have been established as mandatory use for the taxpayer or liable party.

SANCTION: Fine of one thousand quetzales (Q.1,000.00), without prejudice to compliance with the obligation to file the required information or payment, using these tools, forms, forms or similar.

17.Issuing in illegible, blurred or incomplete form invoices, special invoices, debit notes, credit notes or other documents authorized by the Tax Administration.

SANCTION: Fine of five thousand quetzales (Q.5,000.00) in each monthly period in which the violation is established. In no case shall the maximum sanction exceed one percent (1%) of the gross income obtained by the taxpayer during the last monthly period in which it reported income.

18.The Withholding Agent that does not issue or issues extemporaneously the certificate of withholding effected as required by law.

SANCTION: Fine of one thousand quetzales (Q.1,000.00) for each withholding certificate not delivered on time.

The Executive Branch, at the proposal of the Tax Administration, shall formulate through the Ministry of Public Finance the updating of the value of the sanctions and shall propose to the Congress of the Republic the pertinent reforms every five years.

Taxpayers or liable persons who, upon becoming aware of the commission of a violation of formal duties, among those established in this Code or in specific tax laws, punishable by pecuniary sanction, without having been required or audited, voluntarily appear before the Tax Administration accepting the commission of the violation, the corresponding sanction shall be reduced by eighty-five percent (85%), provided that payment is made immediately. This reduction shall not apply where the taxpayer reoffends in the commission of the same violation during the corresponding taxable period.

Professionals or technicians who, by legal provision, provide services in matters of their competence for compliance with the tax obligations of the taxable persons subject thereto, are liable if, through intent, noncompliance with their obligations occurs.

This article shall be applied in congruence with the provisions of Articles 70, 82 and 90 of this Code. Consequently, this violation shall always be submitted to the cognizance of a competent judge of the criminal branch.

There is breach of duties when the public official or employee of the Tax Administration, abusing their office or function, orders or commits any arbitrary or illegal act to the detriment of the fiscus, taxpayers and liable persons or third parties; when they omit, refuse to perform or delay any act inherent to their function or office and, likewise, when they disclose or facilitate the disclosure of facts, proceedings or documents of which they have knowledge by reason of their office and which by provision of law must remain in secrecy or confidence.

The foregoing violations shall be sanctioned by the Tax Administration in accordance with the provisions of the Civil Service Law and the Law of Responsibilities, without prejudice to the corresponding civil and criminal sanctions.

The relief from surcharges and fines corresponds to the President of the Republic, who may authorize the Tax Administration to exercise this power, interest constitutes surcharges.